For six straight months, factory orders have fallen, firms have laid off workers, and real output is lower each quarter. Which business-cycle phase best fits these conditions?

Consumer spending rises, businesses add workers, and real output increases quarter after quarter. Which phase is the economy experiencing?

After a long decline, real output reaches its lowest point and stops falling before beginning to rise. What phase has the economy reached?

Real output has risen for years, reaches its highest point, and is about to begin falling. What phase is this?

Retail sales weaken, inventories pile up, and employers cut work hours as real GDP declines. Which phase is most likely occurring?

New home construction increases, firms invest in equipment, and unemployment generally falls. Which phase best describes this economy?

Business investment and consumer spending have leveled off at a high point after a long period of growth, just before declines begin. Which phase is this?

Production has fallen for many months, but firms now report stable output at the cycle's lowest level. Which phase is most likely?

What phase belongs in the blank on the business-cycle figure?

On the business-cycle figure, what phase does point A show?

What phase belongs in the blank on the business-cycle figure?

On the business-cycle figure, which phase does point B represent?

What phase belongs in the blank on the business-cycle figure?

On the business-cycle figure, what phase does point C identify?

What phase belongs in the blank on the business-cycle figure?

What turning point is point A on the figure, and what follows it?

What turning point is point B on the figure, and what follows it?

In the second cycle shown, which sequence describes point C?

Which sequence describes point D on the figure?

In the business-cycle model, what does the straight rising line through the middle of the wave represent?

Which condition matches the commonly used classroom rule for identifying a recession?

Which list gives the four standard phases of the business cycle in their usual order?

A country enters its second year of strong expansion. What is most likely happening to employment and household incomes?

During a contraction, what is the most likely change in business sales and employment?

An economy has just reached a trough after a severe contraction. What is most likely to happen next?

What term describes an increase in the general price level?

What two changes can raise the price of a product in a market?

What is inflation?

What is deflation?

What is disinflation?

How does deflation differ from disinflation?

Inflation falls from 5% last year to 3% this year. What is this called?

Last year the inflation rate was -1%. What does this indicate?

Why does purchasing power fall during inflation?

What is the quantity theory equation of money?

What do M, V, P and Q stand for in MV = PQ?

What is velocity of circulation?

In the crude quantity theory, which two variables are assumed constant?

What is another name for the quantity theory equation of exchange?

Under the crude quantity theory, why can more money cause inflation?

Under the crude quantity theory, what happens to P if M decreases and V and Q stay constant?

What is aggregate demand?

Which components make up aggregate demand?

How are net exports calculated?

What is aggregate supply?

How does cost-push inflation occur?

How does demand-pull inflation occur?

How can higher transfer payments cause demand-pull inflation?

What is the likely effect of NZ dollar depreciation on net exports, other things equal?

Which TWO events could cause cost-push inflation?

How can NZ dollar depreciation cause cost-push inflation?

Which pair of flows can change the domestic money supply?

Why can lower interest rates increase inflation?

Which are the four phases of the business cycle?

Approximately what share of NZ aggregate demand is Government spending?

What is the formula for percentage inflation using CPI?

What are the axes on an AD/AS diagram?

What is hyperinflation?

Which country is a well-known example of historical hyperinflation?

Why might higher broadband costs contribute to inflation?

What is a limitation of the crude quantity theory of money?

What does the vertical YF line represent on an AD/AS model?

What is a recessionary gap on an AD/AS diagram?

Why does the AD curve slope downwards to the right?

What is an inflationary gap on an AD/AS diagram?

During which business-cycle phase is inflation likely to be lowest?

Which change could shift the full-employment output (YF) line to the right?

What is inflation driven by higher production costs called?

Which curve shifts left in a standard cost-push inflation diagram?

What is inflation caused by rising components of AD called?

In which direction does AD shift during demand-pull inflation?

What is the difference between household saving and business investment?

How do lower interest rates generally affect economic activity?

What is another name for the business cycle?

What are the axes on the business cycle diagram in the worksheet?

Which phase normally follows recovery or expansion in the business cycle?

Why are fixed-income households harmed by inflation?

How can inflation affect NZ exporters?

What happens to the real value of household savings during inflation if interest does not keep pace?

Which country experienced an episode of extreme hyperinflation discussed in the original worksheet?

Complete the relationship: real interest rate is approximately ...

Teachers get a 2% nominal pay rise while inflation is 1.5%. What happens?

What is the Consumer Price Index (CPI)?